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I hate this "America is losing greatness from losing manufacturing" argument. Our citizens don't want to work in manufacturing, and the Chinese (and other foreign citizens) are willing to do it for less. Sure, why not, they deserve it!

The world would improve if we stopped thinking in a "us-vs-them" nationalist way. Think in a global way!:

* We're helping Chinese farmers get out of abject poverty into a slightly better situation.

* We're improving their economy

* We're making cheaper goods for Americans & other developed countries, which means that it will be accessible to poorer people (which is a good thing!)

* The company will gain more profit and be able to make more innovative toys for us!

If we want to go down the nationalist root, then why don't we just outlaw imports all together? Or at least pass some protectionist tariffs?

If we did that, with the foolish misconception that it would help our economy, we would goad other countries into passing tariffs, and the whole world economy would hurt. http://en.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_Act The Smoot-Hawley Tariff provoked that kind of response and was a key factor in creating the Great Depression.

> Our citizens don't want to work in manufacturing

Not true among those to whom college is not attractive. There is a group of Americans that would like a semi-skilled labor job that affords them a middle class lifestyle.

I grew up in an area primarily populated with people like that, and while all of my friends are now of the BS/MS/PhD crowd, there is a huge set of people who now go on to college not because they want to but because they don't know what else they can do. Unless they are lucky enough to know somebody who can get them in as an apprentice at a union.

Those people don't want the lifestyle afforded to Chinese factory workers, but the fact is that this lifestyle is an improvement for the vast rural Chinese underclass; this argument comes dangerously close to suggesting that we should further impoverish millions of people to improve the lot of tens of thousands of Americans.

It seems to be a simple fact that the US is structurally disadvantaged in electronics manufacturing.

> this argument comes dangerously close to suggesting that we should further impoverish

I apologize if my comment came across as suggesting a course of action. I'm merely commenting on the original commenter's assertion that Americans do not want manufacturing jobs. I have personally found that to be untrue, even if the job that they wish to have might not be possible here because of economic and/or regulatory reasons.

I just think you have to be careful not to conflate. Americans are willing to work in manufacturing; that's obviously easy to see. They are not willing to work for Chinese manufacturing compensation, even after you correct for environmental impact and shipping costs.

If manufacturing simply can't pay what an American worker needs to make, their willingness to work in factories isn't relevant, is it?

> Those people don't want the lifestyle afforded to Chinese factory workers but the fact is that this lifestyle is an improvement for the vast rural Chinese underclass

Why do you think this might be true? The only reason Chinese workers are poor is that they government let companies treat them as slaves. I don't think we should even consider that taking part on this is fair to Chinese people. On the opposite, agreeing with the practices of the Chinese government is exporting poverty to other parts of the world.

If you think that the advantage is that Western countries get cheaper products, this is wrong again: we could get cheap products anyway, but just using more machines instead of semi-slave labor.

No, you've misread me. I'm comparing Chinese factory workers to (more numerous) Chinese rural poor, who make four to five times less than the factory workers, and whose poverty cannot be attributed to greedy factory owners.

In objective terms, however exploited you think technology manufacturing "slave laborers" are by companies in the west, the west has done those workers a favor. The status quo ante was a poverty so grinding as to make the comparison to unemployed US auto workers laughable.

When you visit a factory, it is easy to see that this is not the case. Yeah, the work sucks, but workers are happy to have the chance in general - they save money to build businesses, give to their families, etc. Factory work is better than starving, and better than farmwork.

There is a group of Americans that would like a semi-skilled labor job that affords them a middle class lifestyle

What job is that? Because it's apparently not (US) manufacturing

Oh, certainly it is. There are a lot of union jobs that pay well, though admittedly the better-paying ones require quite a bit of skill. My brother is a pipefitter, and while he makes more than many software developers, he is also qualified to handle pipe work (layout, welding, testing, etc.) in hospitals, hazardous chemicals and treatment plants, etc.

My father also runs one of the few remaining foundries and employs some semi-skilled, decently paid labor.

But, nether of those industries current employ enough people to make up for all of the folks who would want them. Or at least, until our infrastructure bill comes due -- a significant portion of the 50s and 60s era suburb/exurb buildout will soon require substantial investments just to have water/power/roads continue to function.

> Our citizens don't want to work in manufacturing.

Bullshit. Just a couple weeks ago I was talking with some people who have a family manufacturing business. They love it. Their employees love it. Their son wants to keep the business going.

Further, even if a lot of people wouldn't ask for a manufacturing job as their first choice, quite a lot of them would prefer it to unemployment, or a minimum wage customer service job, or cleaning executives' houses.

For a lot of people, making actual stuff is very satisfying. I really enjoyed my summer factory jobs, and I'm lucky that I happened to love making software more.

For a lot of people, making actual stuff is very satisfying

Yes but "manufacturing" can mean all kinds of work, and you've not elaborated as to what your friend's family manufacturing business actually makes.

With the type of high-tech electronics manufacturing the original article is talking about no one actually 'makes' anything - it's watching lines of machinery print circuit boards and solder chips onto them.

That's very different to, say, a mom-n-pop US-based hand-made toy manufacturer where people are genuinely crafting something.

I might be wrong, but I actually don't think it is as simple as that. Yes, it is detrimental with a too strong us-vs-them sentiment. But it is also true that the world is better off when every individual state is in good shape.

The author of the article argues that the ability to innovate within an industry niche disappears with the manufacturing. Correct or not, the problem they are pointing out is not that manufacturing is disappearing but that all capacity for intellectual development goes with it.

I'm all for balance, but I don't think the right way to achieve it is to cripple the stronger side of the scale.

But, then, why would they need you? All you end up with are companies that can't make stuff competing against companies that can.

As China and India make more money, their workers will start demanding a bigger piece of the pie (we're already seeing this). Their prices will go up, meaning that, by comparison, U.S. workers will start to be a bit more competitive.

I've also seen reports that offshoring customers have been bringing back some of their work to the U.S., sometimes because of poor quality but also for tighter coupling and shorter response times.

China is making 'stuff' but they're not developing ideas or creating the software. Our strength is in management, finance, design and software development. I don't think we should shed any tears for a lost manufacturing industry-- hopefully it'll encourage more people to pursue these more intellectual careers.

> China is making 'stuff' but they're not developing ideas or creating the software.

For now.

Innovation requires two sorts of deep understanding: what people need, and what one can create. We are losing the latter, because much of the creation has gone elsewhere. A lot of Apple's design power comes because they're still deeply involved with the million physical details most companies now ignore.

Software for the US market may be a defensible competency, because we understand both medium and need. But there's little reason to expect that most of China's software will come from the US; they're developing the capability, and understand their needs much better.

Remember, to get China to send us the stuff, we need to send them something in exchange. Right now for every $1 of goods we send them, they give us $3.5 back. That's not sustainable.

> Our strength is in management, finance, design and software development.

Why do you think it would be hard for them to develop those strengths? What if those strengths derive from having a strong manufacturing base?

As their own consumption rises, local companies have a much better chance to design products tailored to the needs of their own expanding markets, effectively expanding them further.

And, as for software development, you'd be surprised by how much is developed outside the US.

Our strength is in management, finance, design and software development.

So that means that the 90% of the population that doesn't work in these fields is going to be out of luck? Well, looking around I suppose it does. Uh, and there's plenty of software and finance back-office moving to India.

A policy that plays primarily to a "strength" which encompasses only a small portion of the population ... well obviously primarily going to benefit that portion.

So, you're assuming that in our country everyone wants to work in one of these industries... but what if you don't want to pursue an intellectual career?

More interesting, what if you don't have the education for pursuing such career paths? This is the biggest problem for Americans today. Most Americans have low quality schools that cannot prepare for career paths in Engineering and Science. Most of the Engineering labor in the US comes from abroad, either via American universities of the H1B Visa program. What is left for most US citizens educated in this country?

They will need genomic, health research that target their populations anyway. That's enough to occupy them for a while. What I don't seen in these discussion is the fact that I feel soon, Asia will want things for itself and that's a huge amount of people to serve. They will be busy making goods for them and that should drive up labor costs and help make the US labor look cheaper for US companies.

To look at the loss of manufacturing as an American industry while pretending that is was solely populated by those who chose less intellectual careers on the plant floor is to overlook the fact that manufacturing, coupled with our great land expanse and growing population, was the prime enabler for the pursuit of intellectual careers since the 1930's.

Most, if not all of the business practices you'll learn today in a renowned university were conceived in the laboratories of American industry. Universities were founded with the whole purpose of providing trained managers and researchers to the manufacturing industries. Unfortunately, those highly educated and trained managers failed to see that the American success story was industry itself, not their ability to make manufacturing cheaper overseas.

The consequences are more than apparent. Managers have to slave to meet Wall Street's predictions and goals, hard working people have to choose a career between writing software, selling financial products, providing healthcare services or working in a derivative position of such in order to make a decent living, and those who choose the higher intellectual pursuits, well, they get to choose whether to offer you paper or plastic at the checkout counter.

Sadly, those who lack a strong educational background or the finances to improve upon it will be further sidelined and alienated from the growth economy and be forced to compete for continuously devaluated and scarcer positions while being forced to hand their pay over to the few companies that can compete in a global economy. And allowing them to buy cheap flatscreens at a super warehouse is not going to vent their frustration.

On the whole, the people who lost the American factory jobs are still vastly better off than the significantly larger cohort of Chinese rural poor that ended up with those jobs.

There's probably a lot of worthwhile policy steps we can take to help American ex-factory workers, but reclaiming the factories needn't be one of them. Factories may be a dead end.

You have to find another way to generate value. That can end up being hard if the research attached to the manufacturing operation gets behind the competition.

How are they vastly better off? Please visit any city in the Rust Belt. Get out of the house and ask how any service sector employees are making ends meet. They went from having honest, well-paying jobs that enabled them to build lives, families and communities to watching their source of income shipped overseas by the very people they worked their asses off to send to college all because the manufacturing industry's market efficiencies didn't match those they taught at business schools.

Policy steps? Open more fast food franchises? What do you do when you terminally impoverish a large swath of your population after exploiting them for sixty years in order to achieve some financial utopia that they didn't need anyway? You can't sell them on owning a house while they make a marginal wage. You can't sell them on seeking out intellectual knowledge while the cost of education soars. You can't keep bombarding them with mainstream images of prosperity when they're worried about making rent. They're going to turn to anyone with a message of hope, no matter how ludicrous. It happens all the time. And then you've lost them.

Reopening factories may not be the panacea, but you cannot innovate across the board when you don't build anything. You cannot innovate while locking a segment of the population out of the process just because they don't have a degree or know the secret handshake. It's the same reason why you can't lock women or minorities out of the process. Otherwise we'd just be a bunch of white guys building apps that address white guy, first world problems and the world would be a shitty place.

This is the point where the new CEO, Mr. Obama, has the honor of addressing the company to tell everyone that we hired way too many people for a product that nobody wants and we'll be retaining the software patents and letting everyone else go. A task he's understandably reluctant to perform.

Increased government spending, entitlement and tax reform, forcing the Chinese to change their monetary policy, investing in nenewable energies, nuking Pyongyang, ok maybe not nuking but really doing something about Mr. Kim would be nice; these are all hard steps that need to be taken but they can only be taken once the leadership comes forward and admits that we have some hard times ahead and that we need to scale back the American Dream a notch and get real.

Unfortunately, one half of the leadership has spent the past twenty years stoking fear and bigotry into a frothy mass with a mixture of penis and religion while the other half has been betting on the kitten at the dog fight, all coaxed on by sources of information that wish the free drama to keep playing itself out. It's time to take a long ,hard look at the landscape and realize that we have a problem and that we need to close the gap before we're in true banana republic territory.

The median household income in Youngstown, OH is $25,000. The average salary in Shenzhen is ~$6000, implying a "household income" of $12,000. People in the rust belt are better off than Chinese factory workers, and Chinese factory workers are better off than the Chinese rural poor.

I don't have 5 additional grafs of politics to give you after this observation, but do note before you get irritated with my comment that our politics are probably very similar; I just think opening more factories is the wrong intervention.

Are those PPP dollars, or exchange rate dollars?

I think you should look into additional graphs; they may help you understand income correlation. And I don't mean to be insulting, but just by looking at the figures, it's clear that the workers in Shenzhen are in the middle of economic growth, while the residents of Youngstown, OH, have ceilinged out at slightly above the poverty level. The income per capita in Shenzhen is ~$14K, growing at +10%. Their per capita income is 200% that of the average rest of China's. Youngstown's per capita is ~$31K and in decline, having never reached higher than ~$32K in 2007. That's 65% of the American average of $47K.

The people of Shenzhen have opportunity on demand. The people of Youngstown have no future. Please explain that to them the next time they max out a warehouse credit card on that 48" plasma they needed to have in order to feel better about themselves.

It's not a political problem, it's an economic crisis and we need those jobs back. Costs will go up and we'll have to hang on to that laptop for a year longer than we planned to, but all boats rise when the tide comes in.

I'm not sure I see what the trendlines have to do with quality of life in either locale. Either Chinese factory workers are better off now than autoworkers in Youngstown, or they're not. Either Chinese factory workers are better of than Chinese subsistence farmers, or they're not.

Similarly, I understand the psychological importance of one's income relative to the community median, but I don't see how being worse off than the average American makes a Youngstown factory worker worse off than the average Chinese person.

You seem to think I'm saying "auto workers in Youngstown will be fine". I don't think that.

We can't just make up new facts to make political priorities we both hold more compelling.

Finally, by making the cost of laptops increase to create what are, in effect, make-work jobs in on-shore technology manufacturing, we also depress demand and penetration of laptops everywhere. Who's better off in this scenario? If we're going to pay a subsidy to people who would otherwise be assembling our laptops in (say) Youngstown, we should do it directly; taking it out of the entire market for laptops is regressive.

I understand your point but you can't give people what amounts to a handout while reminding them that they're better off than the Chinese.


What's wrong with receiving a handout?

What's wrong with being better off than citizens of another country?

If you don't like the former, go work another job in another city.

If you don't like the latter, go work another job in another country.

- It dehumanizes the spirit and makes the receiver a dependent of the state; later to be vilified by an ignorant society at large when it suits them.

- Comparing apples to oranges is patronizing at best. Being better off is contextual and you cannot compare a child who won't eat broccoli to a Biafran baby.

- A vast majority of people live, work and die within a relatively short distance of where they're born and outside of famine and conflict, you're not going to get them to move away from of their family and/or community networks. The chance that they're even able to do so severely declines with the absence of solid education or an established, dependable contact in another city. Yes, there are plenty of people who do it, but there are usually mitigating factors that affect the decision-making process outside of those who have chosen a career that requires a move. We'd like to think that we're a society on the move but the reality is quiet the opposite.

- That's an even worse suggestion than moving to another city or out of state. Outside of high-skills, training and education protected jobs, there isn't much need for labor in other countries. As a matter of fact, most countries have a surplus of labor, not to mention a wage differential that would basically wipe out any future earnings potential. The suggestion is so ludicrous that I won't even address legal, language, cultural or distance problems that would turn away most people who even dream of doing it. And I say that as someone who spent ten years in a foreign country where English isn't spoken. That's asking the impossible and has very few benefits for anyone involved.

In conclusion, the "love it or leave it" crowd can stuff it.

honest, well-paying jobs

There's something that bugs me about the phrase "honest work". It implies you need to do (usually) manual menial labour in order to be fulfilled as a person. It seems like the kind of meme the rich robber baron factory owner tells to the poor serfs in order to keep them happy with their lot. The hell with 'honest work'.

If work was so great, the rich would have kept it to themselves.

I disagree. When I think about the mention of honest, well-paying jobs, I visualize jobs where a person is hired on the merits of their experience and character, where their efforts go towards progressing, learning, teaching and helping while growing along their peers with the security of full time long-term work earning a wage that affords for savings after expenses, advancement and the freedom to lobby for change in the workplace. An honest job is provided by the employer with the responsibilities of paying taxes and benefits shared with the employee. It has nothing to do with being menial or even manual for that matter.

A dishonest job is where an employer takes advantage of the employees or market conditions to offer insecure, low-paying wages where the employee is subjected to conditions designed to restrict their wage-earning ability, restrict their freedom of advancement and deny them their legal rights while simultaneously trying to avoid paying proper employment taxation or offering benefits to the employee. An example of this type of employer would be WalMart.

The argument of "jobs America doesn't want" is completely false. You are assuming that all jobs in manufacturing are $10/day jobs that only poor Chinese people may want.

While there are many under payed workers, attached to these industries are thousands of high paying jobs that become part of the manufacturing environment: managers, engineers, service people, and entrepreneurs that participate in the supply chain.

For China, while it is convenient to have a large population base that works on $10/day, the goal is to create a middle class that manages these people and eventually creates new companies, while at the same time making way much more money.

==> Is it implied that since the average American doesn't like some work, America is being afforded a chance to uplift "Chinese farmers" and whole bunch of other poor people? Is it?

==> Isn't such a thought ridiculous? Such a thought, I think implies that the global economy is a kind of a neo-socialist+charitable-capitalistic kitchen whose main aim is to feed the poor and in the process fatten some of them more than the others. Is it?

==> I think that the right question to ask is not if - Amazon Can Make A Kindle In the USA? The right question should be - Is the Amazon Kindle manufacturing ecosystem truly balanced? - If not, then in the long run some parts of the ecosystem will be eliminated, so that the ecosystem finds a balance.

==> Different regions have different geographic/social/economic environments and will be better suited for some kind of work than other regions. One can not ignore these facts.

But, does amazon have a real stake in the companies that make the Kindle China/Korea? I think not. Isn't there an imbalance between what these companies gain, in terms of ability, from this ecosystem and what the rest of the ecosystem (Amazon/American) gets back?

I dont think american companies have a stake in the Chinese/Korean companies/economies that they outsource to. In return they give you low cost electronics - in process building the largest reserves of dollars in the world and building the ability to innovate themselves in the long run.

==> I wonder how digium works though? http://www.digium.com

==> There is no point in being crazy nationalist. But I don't understand why a nation with such a huge continent can't find a place where it can build a manufacturing hub that can participate in the global manufacturing industry.

The country has enough people to enable a volunteer military, but for some reason can't find people who can build a manufacturing hub? even if this was the case - haven't immigrants signed up before?

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